Verizon (VZ) Investment Risks

Investment Risks Verizon faces various risks that could affect its earnings going forward. The company operates in a highly saturated and competitive industry, and faces increasing competition from its largest competitor, AT&T, in all its operating segments. Wireless Verizon may face a shortage of spectrums as more and more of its customers switch over to 4G LTE. The company must, therefore, expand its spectrum holdings in order to accommodate increasing data usage. However, there is a possibility that the company will be prevented by the Federal Communications Commission from participating in future spectrum auctions. Within the wireless segment, the company is also under threat from the fact that it is operating in a saturated market where all carriers are fighting over the same pie. Besides its competition with AT&T in the wireless and wireline businesses, low-cost, no-strings-attached carriers like T-Mobile are also threatening Verizon's pre-paid business. There is also the risk that increased data usage will lead to a reduction in average margins, which will lead to lower average revenues per user for Verizon. Wireline Along with the rest of the industry, Verizon continues to lose connections to retail subscribers in the wireline segment. The company also faces risks in its Enterprise Business Solutions and Wholesale Businesses, as corporations continue to sit on their cash rather than invest in new equipment or services. SOURCES: BIDNESS Company Data, SEC filings, Bloomberg Professional Services et DISCLAIMER: All brand and product names, associated logos and trademarks contained within this website belong to their respective owners and are protected by copyright. Under no circumstances may any part of this be reproduced in any form without the prior written agreement of the respective owners.